During the 2nd week, since the extreme drought all over the world I still put eyes on the demand shock. Based on the information form the REUTERS, Russian would restrict there wheat export if the domestic price remain high.

“Russian ministers dismissed the idea of export curbs, while the market already anticipates that Russian wheat exports will dwindle in coming months because a severe drought has hit the harvest there.”
However, Western European wheat is expected to fulfill the export demand. Some good news also from India that the Indian rupee hit a new four-month high on Monday, coming close to breaching 53 to the dollar. The wheat future I focused on was W3H.  As the wheat future mkt was really unstable in the last few months, I decided to leave the mkt for now.

Some other news form India, according to Mankharia, a trader based in Bikaner, Rajasthan, “Heavy rains in September in northern India have raised the prospects of more sowing for the winter season and conditions are favourable for a bumper wheat crop for the third straight year”. Therefore, there must be an expectation of softening future prices, and I short on C2Z.

However, because of the supply shock, the expectation form the Russian restriction dominate all other factors, both C2Z and W3H price drop in Thursday but raised in Friday again. I should have leaved the mkt after Thursday’s gain but I missed the point.